Oil Monitor as of 15 August 2023

Date published: August 16, 2023

WORLD OIL PRICES (August 7-11, 2023, trading days)

The week-on-week price of Dubai crude has increased by around $2.15/bbl. MOPS gasoline, diesel and kerosene have also increased by about $2.40/bbl, $1.10/bbl and $3.60/bbl, respectively.

Reasons for the Price Adjustment1

  • Oil prices surged to multiple month highs as tightened OPEC supply throughout September offset the latest weekly US Energy Information Administration production forecasts and inventory data.
  • On the bullish side, OPEC+ cut its crude oil production to a near two-year low in July as the major voluntary cut by Saudi Arabia took effect. The latest Saudi cut, as well as disruptions in Kazakhstan and Nigeria, more than offset increases in Iran and Iraq, contributed to an almost 1 million b/d fall in OPEC+ output month on month.
  • China's crude imports fell to a six-month low despite a 17% on the year jump as an adjustment from the recent high seen in June, while oil product outflows rose to a four-month high amid improved export margins.
  • The Asian gasoline complex strengthened, tracking gains in US-RBOB Brent crack amid a drop in US inventories.
    • Looking forward, US import demand might moderate as gasoline inventories might go up amid the anticipated return of ExxonMobil's 630,000 b/d Baton Rouge refinery by late August following an unplanned turnaround that began July 24. Yet the refinery may return from maintenance to produce winter-spec gasoline despite lingering demand for summer-spec gasoline.
  • Some market participants highlighted the importance of the upcoming Chinese export quota as many Chinese exporters have already exhausted a substantial portion of their existing export quotas for gasoline. Exports are also anticipated to rise on the back of a possible drop in domestic demand amid heavy flooding in the country.
  • On Asian gasoil/ diesel market, increasing outflows from China and unviable East-West arbitrage economics continued to weigh on Asia gasoil crack. The next batch of export quota will be soon released, allowing more exports in August. This is despite that PetroChina's 200,000 b/d Dalian West Pacific Petrochemical Corp, or Wepec, plans to skip gasoil exports in August for potential recovery of domestic diesel demand after lifting of fishing ban.
  • Chinese gasoil outflows are estimated at 600,000 mt for August, down from 1 million mt in July. Also, outflows from South Korea are likely to recede on the back of scheduled turnaround at Daesan complex from August to mid-September.

FOREX: The week-on-week average of Philippine peso depreciated versus the US dollar by P1.04 to P56.16 from P55.13 in previous week.

DOMESTIC OIL PRICES

Effective 15 August 2023, the oil companies implemented an increase of P1.90/liter for gasoline, P1.50/liter for diesel and P2.50/liter for kerosene.

These price adjustments resulted in a year-to-date net increase of P13.40/liter for gasoline, P8.60/liter diesel and P5.14/liter for kerosene.

For the updated prevailing retail pump prices, please refer to this link:
    • https://www.doe.gov.ph/retail-pump-prices-metro-manila

Other recommended reference sites:
    • http://www.aip.com.au/pricing
    • http://www.indexmundi.com/commodities/?commodity=crude-oil-dubai
    • https://www.quandl.com/data/ODA/POILDUB_USD-Dubai-Crude-Oil-Price

For more information, call the

Department of Energy
Pricing: 840-2187
LPG: 840-2130
Fuels: 840-5669
Website: https://www.doe.gov.ph

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1 Asia-Pacific Weekly Recap 11 August 2023 by S&P Global Commodity Insights.

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